The latest reports from leading economic groups, the International Monetary Fund and the Economist Intelligence Unit, say Fiji's saggy economy and uncertain political situation remain a concern.
Detailing the increasing loss of civili liberties and defections, resignations and dismissals the Economist Intelligence Unit says the unlected government is unlikely to release its hold on Fiji citizens.
"The Economist Intelligence Unit believes that Commodore Bainimarama will hold firm to his decision to delay the next election until 2014. There are also doubts about whether the poll, when it happens, will be free and fair."
The unit also warns investors of the grim realities of Fiji's economy. "The government has ambitious goals for economic reform, including boostingGDP, carrying out land reform and eli minating the current-account deficit.
"However, the high level of public debt means that the government is under pressure to reduce the size of the public sector, and only limited progress towards this objective has been made so far. Fiji remains a highly unpredictable destination for foreign investment.
"Legislation passed in 2010 outlawed ownership of media organisations by foreigners, and a large US-owned producer of mineral water, Fiji Water, was hit by a dramatic rise in the water resource rent tax in the 2011 budget."
It goes on to say that he regime's record on economic management is "patchy."
"We estimate that it posted a budget deficit in 2010 and that another will have been recorded in 2011. The budget for 2012 outlines considerable changes to the tax regime.
"Fijians, and particularly those on low incomes, are to see their income tax contributions slashed. The government intends to enable this measure to be afforded through increases in a number of indirect taxes, and believes that the industries affected by these rises will be sufficiently strong to cope.
"The 2012 budget aims to achieve a much smaller deficit, at the equivalent of 1.9% of GDP, this year, despite another increase in spending.
"We believe that the authorities will struggle to meet this ambitious target, particularly given the substantial changes to income tax that are planned. We forecast that the deficit will widen in 2012, to 3.4% of GDP, and will remain around this level in 2013."
In the second report on Fiji, the International Monetary Fund says there have been some gains in the economy but "it seems unlikely, given fundamental and economic constraints, that growth will exceed 1½ to 2 percent on a sustained basis unless structural reforms are accelerated. Risks around this outlook are tilted to the downside, given political uncertainties, structural weaknesses, and the fragile global economy."
In a rare foray into domestic politcs the IMF has also called for the regime to relax emergency measures ahead of the 2014 election.
It says its mission had found the economy needed structural reforms and a "concrete plan" ahead of the first elections since a 2006 military coup.
It says "removing structural impediments to growth is critically important" and that many of the mission's interlocutors suggested that relaxing the emergency regulation and establishing a clear path toward a 2014 election would be the key measures to boost investor confidence."
"The current government took power in a 2006 coup, relations with traditional donors are strained, and FDI (foreign direct investment) has dropped sharply, though emerging donors remain engaged and have provided assistance.
"Elections expected for 2009 did not occur, but the government has subsequently announced plans for an election in 2014 and provided an allocation in the 2012 budget for electoral preparations."
The IMF says "Monetary conditions are accommodative and the system is awash with liquidity on account of foreign exchange inflows. However, credit growth has been slow, and banks’ loan-deposit ratio remains below 90 percent."
It adds: "While lending to the private sector is now rising at about 5 percent, the Reserve Bank of Fiji (RBF) is concerned that small and medium sized enterprises (SMEs) and others are being shut out.
The IMF says higher food and oil prices have contributed to weak external balances saying: "The financial sector is stable, but FNPF finances are unsustainable over the long run. The banks are well capitalized, with low NPLs and adequate loan loss provisioning.
"The finance-company and insurance sectors are stable, but the largest nonbank financial institution, the FNPF, is actuarially unsustainable: its current pension annuitization rates, which vary from 15 to 25 percent for different pensioners, imply negative net cashflows by 2030 and depleted assets by 2056."
The Intelligence Economist Unit report
www.mediafire.com/file/sa8do51t1376a6e/Fiji Jan 2012 EIU report_dl.pdf
The latest IMF Report